Sustainable Business. Clean Technology. Green Marketplace.

January 22, 2007

Is 'Carbon Neutral' Good Enough?

The bar on climate change keeps rising, at least among a handful of companies seeking to be leaders in this arena. The announcements have been steady of late, with more and more companies claiming some kind of carbon neutrality. In just the three weeks since New Year's:

U.K. retail giant Marks & Spencer announced a plan that will lead to the company becoming carbon neutral by 2012.

Pacific Gas & Electric announced that it would use biodiesel made from soybean oil, along with solar energy and carbon credits, to render Gov. Arnold Schwarzenegger's re-inauguration celebration carbon neutral.

Just today, TerraPass announced the "world’s first carbon balanced retail product."

What, in Al Gore's name, is going on here? Has the whole world gone carbon crazy?

Well, yes . . . and no.

The phrase -- which, as everyone by now knows, was last year's Word of the Year -- is rapidly becoming a minimum expectation of companies, concerts, conferences, celebrations, and other conclaves. That seems like good news, in that climate awareness and action have hit a new level, including recognition by some of the world's largest companies. (January's rush of carbon-neutral news, of course, piles atop the many companies and other organizations that previously had made some kind of commitment.)

But what, exactly, does "carbon neutral" mean? There's no viable definition -- at least none being used by these myriad organizations. In my recent Google News search on the term, I found a wide variety of ways the term was being used, and more than a few questionable claims. (Can one really fly carbon neutral on company jets, even if it's "more affordable than you think"?) Beyond that are questions about how companies are achieving their carbon neutrality -- not all commercial offsets are equal, as I've previously noted.

I'm concerned about all this -- and so should companies that have made, or are thinking of making, some kind of carbon-neutral claim. For starters, as such claims continue to grow in popularity, their value will diminish -- yet another me-too action for all but a handful of companies. At best, carbon neutral will be seen as a de facto requirement, no longer be newsworthy outside the company itself.

That's okay. But beyond that is a bigger concern: that carbon neutrality could be seen as a cover-up for real action. As such, there would be a backlash against companies making carbon-neutral claims without having taken the appropriate precursory steps to maximize their energy efficiency and use the highest percentage possible of energy derived from clean, renewable resources. As I've previously suggested:

buying offsets for an energy-wasteful home or business and calling it environmentally responsible is akin to buying a Diet Coke to go with your double bacon cheeseburger -- and calling it a weight-loss program. Efficiency (and calorie reduction!) comes first.

The problem: No current certification or monitoring system has any teeth, and there is no easy way to confirm that offsetting companies are doing what they promise. Now, various organizations are scrambling to provide standards for what experts call a fragmented market with a product of drastically varying quality.

The question asked by the Monitor isn't going away any time soon, and companies and others seeking to claim carbon neutrality would do well to examine the bigger picture: what, besides "going carbon neutral," are you doing to minimize your climate footprint? The answer should include a wide range of energy-efficiency measures -- from your facilities, to employee commuting and business travel, to the full range of things your company buys and does. Lacking a good understanding of that -- and, hence, a good answer to the question above -- could undermine your organization's claims, perhaps even garner publicity you weren't seeking.

The grilling you get may not be as easy-going as the one received last month by Jeffrey Swartz, CEO of Timberland, when he was interviewed by Stephen Colbert on "The Colbert Report." Colbert admonished Swartz:

"Carbon neutral sounds wishy-washy. You should be pro-carbon or anti-carbon. Carbon neutral sounds like Switzerland. Take a stand!"

Comments

Hi Joel,

Excellent post as usual.

Along with the concern that "carbon neutral" is just "guilt neutral" and not making any real impact, I have the stronger concern that the existence of "carbon offsetting" may actually set us back. People who were conserving energy and cutting carbon emissions may now feel they don't have to if they just be "carbon neutral".

This is essentially outsourcing your dieting, which will make the other person thinner, not you.

We don't need carbon neutral, we need "carbon negative" we need a net reduction in carbon consumption so let's at least push it up a notch and start asking to be "carbon negative".

A good start would be to double the offset, so if you are putting a lb of CO2 in the air, offset it by 2 lbs rather than just 1.

This will, I hope, inculcate a mindset that reinforces the need to *reduce and not just offset* overall carbon emissions.

Aside from obvious next steps of putting in place 'Carbon Neutral' definitions, standards and targets, there is a growing realisation that we're all in this together.

It makes sense that the metrics be consistent across the topic and around the world. Rather than just the annoying little graph which appears on the quarterly electricity bill, explaining how tonnes of C02 my accomodations have produced, there needs be linkage and reporting at a community and also at a country level. It is not until folks can see how their individual actions impact those around them, that the case for sustained behaviour change can occur. Hopefully the politics and business community still follow the will of the people.

Want some validity on "carbon neutrality" claims ? There needs to be a standard -- sometime such as this: http://www.resource-solutions.org/where/stakeholderadvisories/2007/GHG_Reduction_Product_Standard_Comment_Period_Ends_1.31.07.html

There is a moral element to this also apart from the concerns stated above.
Is it really fair that I make my holiday flight carbon neutral while when we are calling on developing nations and expect the poor to watch their carbon footprints as well?

What this needs is -apart from common standards et- is to give carbon quotas and be carbon negative tied to raising the living standards of the developing nations.

If you fly or any other luxury you pay for the carbon and to help others get a carbon neutral lifestyle.

Joel - thanks for keeping us on our toes. It does seem that the more we hear about carbon neutral, the more it appears to be a company taking the easy way out. I suspect that your point about garnering publicity you weren't seeking will continue to play out as the mainstream media educates itself on sustainable business practices. I hope to see the media continue to push companies for the substance behind their story. Carbon neutral, or negative as Nitin suggests, could be worthy of recognition, but not if it is where the story begins and ends.

With any luck, blogs like yours will continue to infiltrate the mainstream and keep us all on solid ground.

I must agree with the previous 5, this is a really good article. Nice job, Joel.

I think the diet coke and cheeseburger analysis really hits at the issue. There's just something about companies that dip into their profits a little bit by buying some offsets, that really smacks of something not right. I can't put my finger on it. Chronology, I guess? Maybe it's because there's a lot of work to do on processes and in innovation to become more energy efficient, less of an environmental impact, and more of a contributor to sustainable business practices.

Joel, I think we also need to question exactly WHAT is being made carbon neutral, for example Dell's announcement is only planting trees for customers that volunteer to pay the extra fee. That is no different from those few customers actually doing it themselves. If they believed in Carbon Neutrality, they would be doing it for ALL sales of the products.

I don't know, but expect DHL's offering is similar - i.e. only neutralising the carbon of people who volunteer to pay a surcharge.

Don't let go of this one, Joel. We need to keep hammering, hammering, hammering away at the offset-as-panacea myth. Alas, we've likely another year or two of 'carbon offset as valid PR campaign' to wade through before the truth is heard.

Joel - the Institute for Market Transformation to Sustainability (MTS) is working to make sustainable standards part of all manufacturing and buying decisions. Their SMaRT standard is based on tri-bottom sustainability, which covers social equity as well as green and financial considerations. If anyone would like more information they can go to http://mts.sustainableproducts.com. One page has a great summation of the major labels and what they mean for the average citizen.

Both going carbon neutral and/or a totally sustainable product life-cycle requires time, effort, money. The effort is going to HAVE to go into making the world more sustainable, so why beat ourselves up over techniques? We clearly need to do everything we can to dig ourselves out of this multi-generational hole.

Oh, and re: "has the world gone crazy?" The world has been crazy. If anything it's going sane. Slowly.

I was reading about a small California company that just spent $30,000 to improve energy efficiency by covering their roof with dirt/drought resistant plans. Their website says their solar panels eliminate about 20,000 lbs (10 tons) of CO2 emissions per year. If you multiply this by the $6.40 per ton that Salesforce.com is paying to go carbon neutral, this company could gone guilt free for less than $64! So I TOTALLY agree. Buying your way to carbon neutrality doesn't demonstrate real commitment at all.

Hi Joel, I completely agree with the limitations of offsetting. I've got a couple of points to add -

1. Something radical really is underway in all the new green propositions being developed by big companies. And many of them go beyong offsetting. Marks and Spencers' recent eco-plan, for example, recognises that offsetting must be a last resort and certainly doesn't replace operational efficiency.

2. Corporate environmentalism is consumer driven, and to affect it we need to become more discerning shoppers - particularly with regard to the information that we require to decide on a purchase.

A)
1/29/2007
http://www.physorg.com/news89299727.html
Study: Next decade 'crucial' on warming
Climate effects from global warming will be irreversible in 10 years with "serious reductions in carbon emissions," British researchers have concluded.
...
"The next 10 years are crucial," said Richard Betts, the head of a British climate research team. "In that decade we have to achieve serious reductions in carbon emissions. After that time the task becomes very much harder."
...
http://www.physorg.com/news89299727.html

I hear what you're saying...but isn't carbon offsets and carbon trading progress? Maybe it has its flaws but isn't it better to do it than to not do it? I know you're saying we need a new solution, but I think the people involved in trying to be 'carbon neutral' are ahead of most of the world who couldn't care less....

Is this just another marketing tool in the basket of goodies offered to relief the guilt of consumers. I have seen many claims for products printed on flyers and adverts claiming to being carbon neutral but do they really conform to any recognised recognised life cycle analysis. The Bristish gov. announced its intention to formulate standards to measure carbon offsetting against so that consumers can judge the value of the claims made. A global standard needs to be drawn up before the value of the term becomes just another empty promise.

I agree that although there are issues that need to be resolved with offsetting-- like are the offets people and companies buying really offsets-- but I also agree wholeheartedly with VerticalSolar that it's better to offset than not to.

We also must remember that no individual or company can go from carbon emitter to zero carbon emitter in one step.

Offsets allow us to buy time while we take the necessary steps to reduce our actual carbon footprint.
I offset the carbon emissions in my household while at the same time taking steps to reduce energy use, explore alternateve energy options, etc. I can't just wake up tomorrow and eliminate all of my carbon emissions.

What am I supposed to do-- nothing until adequate carbon-neutral/carbon-negative options are widely available? Or, do I purchase legitimate offsets through organizations like Native Energy and Climate Trust and make SOME difference now? I choose the latter.

The only way we could know if an emission is carbon neutral or not is whether it is within the capacity of carbon sinks to mitigate emissions without an adverse impact on climate.

I think pinning this down is both hugely important and difficult at the same time.

I actually beleive that is is better to accept and promote the current accepted and used definition of carbon neutral as reducing current or future emissions by the same level you emit.

I think the phrase has struck a lot of resonance with people and can be used to promote more climate sensitive behaviours. If we discredit it too much, we will just add to confusion and perhaps turn people off at least making their first inquiring steps.

"Carbon offsets are the modern day indulgences, sold to an increasingly carbon conscious public to absolve their climate sins. Scratch the surface, however, and a disturbing picture emerges, where creative accountancy and elaborate shell games cover up the impossibility of verifying genuine climate change benefits, and where communities in the South often have little choice as offset projects are inflicted on them.

This report argues that offsets place disproportionate emphasis on individual lifestyles and carbon footprints, distracting attention from the wider, systemic changes and collective political action that needs to be taken to tackle climate change. Promoting more effective and empowering approaches involves moving away from the marketing gimmicks, celebrity endorsements, technological quick fixes, and the North/South exploitation that the carbon offsets industry embodies."

I like the analogy to people getting a diet coke with their double bacon cheeseburger. I work part time at mcdonalds (*sigh*) and i've seen people get things like a double bacon cheeseburger with supersized fries (no salt) and a large diet coke.

But i don't think that switzerland is a good comparaison cause switzerland is my favourite european country because (aside from the fact it's very pretty) they seem to be the only country that was immune to wars.....

I agree, carbon neutral is not good enough, because ideally it would be good to be not just neutral but even better- to make up for what the past century and a bit have been doing. and what other people are still doing

And now we can buy certified "CarbonFree"(TM) products thanks to Carbonfund.org and people can feel they are saving the planet because someone did a limited scope life cycle assessment that looks at greenhouse gas emissions for which offsets have been purchased from Carbonfund. Selling indulgences indeed. What we need is for people and companies to think about what they really need and how to satisfy that need at the least economic, environmental and social cost throughout the life cycle. This just perpetuates the same old products and processes.

Not that I am totally against companies buying and selling offsets. They are a great stepping stone to buy time and resources until significant changes to basic processes can be deployed. But they make sense only if there is a true commitment to change practices.

Although your scepticism of carbon neutral schemes is admirable, your arguments are not. For starters, your analogy... cheeseburger and diet coke. This is not an analogy, because the diet coke does not claim to reduce the effects of the burger, merely it claims to be an improvement over the non-diet coke - a valid claim maybe?

Carbon off-setting has some serious theoretical problems which are being ignored as many companies, both international and domestic, jump on the carbon neutral bandwagon.

Firstly, most carbon offset schemes employ reforestation as a sequestration method. This fails to take into account the timing of carbons outputs relative to counter-measures, essentially an old accounting problem. The example: A company emits a tonne of co2, so purchases a 'tonnes worth' of tree planting. The company emits the co2 immediately, contributing to climate change. However, the tree takes 10 years (ish) to absorb and store the co2. Carbon neutral? No. Because you've contributed to 10 years worth of climate change before the damage stops rather than letting it continue indefinitely (better i know, but not solved!).

The second problem with reforestation schemes is the vulnerability to fire, disease, etc. If the forest is destroyed for whatever reason, all the co2 is back in the atmosphere, so even if the carbon-neutral companies replant the trees you've got another 10 years worth of damage, now a whole forests worth.

Thirdly... Where are we going to put all the trees? The space for forestation is limited (or finite), therefore perhaps a 'fossil fuel' type solution?

Carbon offsetting does not actually contribute to lowering emissions, except through the increased cost of energy which, economically speaking, would lower demand. This was surely the point behind the cheeseburger analogy. However let's think it through - example...

British Business (BB) purchases trees in French Forests (FF) to offset emissions. Now, BB is now guilt free, adopts a laissez faire approach to energy use and continues to use more and more energy. French companies see the trees planted by FF, and this reduces their perceived responsibility to reduce emissions. This leads to a double emission increase! (I appreciate this is irrational and there are problems with this argument, but it might have limited relevance.)

The last problem as has already been mentioned in this blog is the lack of a direct relationship between money spent on offset schemes and carbon removed from the atmosphere, along with concerns about certification, etc.

I suppose we should be grateful that companies are at least grasping the need to make a change.